Mercator’s oil and gas businesses will be managed by its wholly-owned subsidiary — Mercator Oil & Gas (MOG), formerly known as Ivory Oil and Gas. The company may divert up to 20% of its proposed capex for acquiring oil and gas assets this year.

Sources said the company is evaluating the scope of some of the marginal fields in Indonesia, Malaysia and Thailand. When contacted, MLL officials refused to divulge any details about oil and gas foray. “MOG is planning to invest in the domestic oil and gas sector as well, though its plans are yet to be concretised,” said sources.

Earlier, MOG and Gujarat State Petroleum Corporation (GSPC) had jointly submitted a bid for the oil and gas blocks under the sixth round of the New Exploration & Licensing Policy (NELP VI). However, the consortium is believed to be out of the race, said sources close to the development.

For acquiring ships, Mercator Lines (Singapore), another subsidiary based in the island nation, is likely to offload around 40% stake to raise $140 million. The company is planning to float an initial public offering in Singapore within six months.

The Singapore operations of Mercator are managed by Shalabh Mittal, son of MLL’s chairman HK Mittal. The Singapore subsidiary is looking after the drybulk segment and its business is structured in a way to avoid conflict of interest with its parent company, said sources.

MLL is planning to buy another second-hand jack-up rig for $200-250 million. Earlier, it had placed an order for a new jack-up rig. In the offshore segment, the group has placed orders for supply boats, platform supply vessels (PSVs) and anchor tugs.

A second-hand Aframax tanker, which was recently bought by the company, is expected to be delivered to MLL on Thursday (January 4). The company had also placed orders for two bulk carriers, one of which will be delivered on January 10, and is expected to carry the Singapore flag.

MLL has signed an agreement with a Chinese company Unipack to transport coal for three years. According to the contract that valued Rs 200 crore, MLL will transport 10-million tonne coal from Arabian Gulf to China. MLL had agreements with Tata Power, Reliance Energy and Maharashtra State Electricity Generation for importing coal.

nevin.john@timesgroup.com

(This article was originally published in The Times of India)

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